In re Estate of Pfoertner

                          NO. 5-97-1041

                             IN THE 

                   APPELLATE COURT OF ILLINOIS

                          FIFTH DISTRICT
_________________________________________________________________

In re ESTATE OF AGNES PFOERTNER,     ) Appeal from the Circuit
Deceased                             ) Court of St. Clair County.
                                     )
(Bernard J. Ysursa, Petitioner-      ) No. 91-P-713
Appellee; Marlene Deen, Raymond      ) 
Snyder, Charles H. Snyder III,       ) Honorable
Theresa Overby, George Snyder, and   ) Jerome P. Lopinot, 
Mary Adams, Objectors-Appellants).   ) Judge, presiding.
_________________________________________________________________

     JUSTICE MAAG delivered the opinion of the court:
     Agnes M. Pfoertner died September 2, 1991.  Her last will and
testament was admitted to probate on October 7, 1991.  On March 31,
1992, an action contesting the will was filed by attorney Bernard
J. Ysursa on behalf of several heirs.  The appellants in this case,
all heirs of the deceased, were named as respondents in the
petition to contest will.
     The will contest was grounded on the fact that the will of Ms.
Pfoertner gave substantially all of the estate to the attorney who
drafted the will, with only minor exceptions.  On February 27,
1997, the circuit court granted summary judgment in favor of the
petitioners and set aside the will, and the estate passed under the
laws governing intestate estates.
     On May 12, 1997, an unsworn petition to distribute net assets,
signed by Bernard J. Ysursa, was filed with the trial court.  In
the petition, Ysursa asked that he be allowed to deduct from each
heir's share of the estate one-third of each share for his attorney
fees in the will contest.  Ysursa also asked the court to allow him
to recover a proportional share of the will contest costs from each
share of the estate.   Later, he modified this position and argued
he was entitled to one-third of the appellants' share of the estate
over the amount they would have recovered under the will, together
with a proportional share of the costs.   This claim was based upon
what is known as the "common fund doctrine".   
     Appellants filed objections to the petition to distribute net
assets, challenging Ysursa's right to collect part of his fees and
costs from their shares of the estate.  A hearing was held on
September 19, 1997, and the evidence introduced in the hearing
included in part the following:  
           The appellants were not contacted by Ysursa to be    
        represented by him.  
           The appellants did not sign an agreement or orally   
        agree with Ysursa to be represented by him.
           The contingent fee agreement was not in writing, and 
        there was some uncertainty about the exact terms of
     the    agreement.
           Ysursa did not keep time records with respect to his 
        work and did not offer any evidence as to the time   
        spent on the litigation.
           Certain appellants' shares of the estate were only   
        increased slightly.
     On November 3, 1997, the court overruled the objections and
granted Ysursa's petition.
     On appeal two issues are raised by the appellants.  They
claim:
               1.   The order of the trial court granting petitioner Bernard
          J. Ysursa a portion of the appellants' shares of the
          estate of Agnes Pfoertner, deceased, should be vacated,
          and the part of Ysursa's petition to distribute net
          assets that demanded the deduction of attorney fees and
          costs from the appellants' shares of the estate should be
          denied.
               2.   If the relief requested in the first issue is not
          granted, then, in the alternative, the order of the trial
          court granting petitioner Bernard J. Ysursa a portion of
          the appellants' shares of the estate of Agnes Pfoertner,
          deceased, should be vacated and the cause should be
          remanded to the trial court for a new hearing on the
          amount of Ysursa's fees.
     Relying principally on Domenella v. Domenella, 159 Ill. App.
3d 862, 513 N.E.2d 17 (1987), the appellants argue that Ysursa is
entitled to no fee from their share of the estate.  In Domenella,
the deceased was survived by several offspring.  The deceased was
the mother of both the plaintiff and the defendants in the case. 
An attorney filed an action on behalf of the plaintiff against the
defendants, seeking an accounting and an equal distribution of the
estate.  The court ruled that three certificates of deposit were
intestate property and should pass equally to the children of the
deceased.  At her death, Teresa Domenella was survived by five
children:  the plaintiff, the two defendants, and two daughters
living in Italy (the respondents).  The attorney then sought, under
the common fund doctrine, a share of the money due the respondents. 
The trial court refused to award the fee, and the attorney
appealed.  The appellate court affirmed.  According to the
appellate court, (1) the attorney did not represent the interests
of the daughters (the respondents), (2) by bringing the action the
plaintiff was seeking merely to protect his own interest and only
incidentally benefitted the respondents, and (3) the intestate
property did not constitute a fund created by plaintiff's attorney. 
We believe that the facts in Domenella distinguish it from this
case.  Moreover, since Domenella was decided, the common fund
doctrine has evolved significantly in Illinois.  We believe that
our supreme court in its more recent decisions makes it plain that
the facts of this case are precisely the type of situation in which
the doctrine applies.  
     Factually, this is a very different case from Domenella.  In
Domenella the property in question was to pass under intestacy
rules.  In that case, the attorney for the plaintiff merely insured
that his client received his intestate share.  The fund (the
certificates of deposit) already existed.  They were not created,
preserved, or enlarged by the attorney.  The attorney merely
obtained an order identifying the surviving kin entitled to receive
the property.  In contrast, in the instant case, the testatrix had
been induced as a result of undue influence to execute a will that
all but disinherited the surviving kin, and the property was to
pass to the testatrix's attorney in a most unsavory arrangement. 
Attorney Ysursa halted the fraud and preserved the estate,
preventing it from being pilfered.  The common fund doctrine allows
a person who creates, preserves, or increases the value of a fund
to be compensated from the fund.  Brundidge v. Glendale Federal
Bank, F.S.B., 168 Ill. 2d 235, 659 N.E.2d 909 (1995).  Without
Ysursa's efforts, nearly the entire estate would have been lost to
fraud.
     Since Domenella was decided, our supreme court in Brundidge
and Scholtens v. Schneider, 173 Ill. 2d 375, 671 N.E.2d 657 (1996),
has articulated a broad application of the doctrine.
          "In general, each party to litigation in the United States
     bears its own attorney fees, absent a specific fee-shifting
     statute.  Over time, courts have created several equitable
     exceptions to this `American Rule.'  One of the earliest, and
     most prevalent, exceptions is the common fund doctrine.  This
     doctrine has been recognized and applied in the United States
     Supreme Court, [in] the lower federal courts, and in the
     courts of virtually every state in the Union, including
     Illinois.  See Baier v. State Farm Insurance Co., 66 Ill. 2d 119, 361 N.E.2d 1100 (1977); Sprague v. Ticonic National Bank,
     307 U.S. 161, 164, 83 L. Ed. 1184, 1186, 59 S. Ct. 777, 779
     (1939) (fee award from fund generated in class action is
     within `the historic equity jurisdiction of the federal
     courts'); see generally 42 A.L.R. Fed. 134 (1979); 23
     A.L.R.5th 241 (1994); S. Speiser, Attorneys' Fees (1973).
               The common fund doctrine permits a party who creates,
     preserves, or increases the value of a fund in which others
     have an ownership interest to be reimbursed from that fund for
     litigation expenses incurred, including counsel fees. 
     Brundidge v. Glendale Federal Bank, F.S.B., 168 Ill. 2d 235,
     659 N.E.2d 909 (1995).  It is now well established that `a
     litigant or a lawyer who recovers a common fund for the
     benefit of persons other than himself or his client is
     entitled to a reasonable attorney's fee from the fund as a
     whole.'  Boeing Co. v. Van Gemert, 444 U.S. 472, 478, 62 L. Ed. 2d 676, 681, 100 S. Ct. 745, 749 (1980)."  Scholtens, 173 Ill. 2d  at 384-85, 671 N.E.2d  at 662.
     The purpose of the doctrine is to prevent unjust enrichment to
those benefitted by the attorney's action, and the decision whether
to apply the doctrine is a discretionary matter for the court in
the exercise of its broad equitable powers.  Sprague, 307 U.S.  at
166-67, 83 L. Ed.  at 1187, 59 S. Ct.  at 779.  Other jurisdictions
have applied the doctrine in cases similar to the case at bar.  See
City & County of San Francisco v. Sweet, 48 Cal. Rptr. 2d 42, 906 P.2d 1196 (1995); Rohrich v. Noziska, 496 N.W.2d 566 (N.D. 1993). 
We believe that the circuit court correctly decided that the common
fund doctrine should be applied in the instant case.
     Turning now to the second issue, we cannot agree with the
circuit court.   Stated simply, the fee-and-cost award as described
above was not based upon evidence sufficient to justify the award. 
In fact, we fail to see any evidence to support the award.
Accordingly, we reverse the award of fees and costs and remand the
case to the circuit court to reconsider this issue.  The circuit
court is directed to consider the issue of fees and costs in light
of those factors set forth in Anderson v. Anchor Organization for
Health Maintenance, 274 Ill. App. 3d 1001, 654 N.E.2d 675 (1995),
and make an award on the basis of quantum meruit.  To the extent
necessary to present their position, the parties should be allowed
to offer relevant evidence on the fee-and-cost issue.

     Affirmed in part and reversed in part; cause remanded with
directions.  

     GOLDENHERSH and RARICK, JJ., concur.